I don’t think the issues with the Soda Ash division and Textile divisions are the same. The management clearly said that the Turkey capacity expansion will force higher cost players to close down and that the Turkish producers would be weary of flooding the market with excess capacity because it is them who also stand to loose from a lower price. A similar situation has played out in the past with the Chlor Alkali industry, where high cost Western producers are forced to close down. Since GHCL is the lowest cost producer in India (?) I wouldn’t be too worried about the next 2-3 years.
The textile division seems to have a much shorter cycle than the Soda Ash business and the textile cos that I’ve looked at (Indo Count and Welspun) seem optimistic about a recovery by FY2019. Of course, its still not clear what is behind this slowdown (cotton price/stronger currency/pressure from retailing clients/pressure from end users).
I’m also uncertain where GHCL’s textile division is placed relative to Indo Count and Welspun. In increasing order of value added products and forward integration, I believe the order is GHCL, Indo Count, Welspun. Maybe this has allowed GHCL’s textile division to increase margins while the latter two had lower margins?